Are you in the market to get a car? If so, you may be deciding on whether to buy or lease. Typically, the choice comes down to ownership and your needs. In any case, before deciding, it’s important to understand the distinctions between the two options. Read on to learn the differences of buying and leasing.
When you buy a vehicle, you typically finance the purchase with a car loan and obtain the title. The bank owns the automobile until you completely pay it off. You also get to keep it for as long as you choose. Moreover, there are no restrictions involved in the process. For example, you’re not obligated to pay for fees that are related to wear and tear and mileage. In other words, the car is your responsibility, especially when it comes to repairs and maintenance.
On the other hand, leasing a vehicle means you pay to drive it for a certain period. However, you will not obtain the title or build equity on it. In other words, you get to rent the car for an extended period. Once the lease period ends, you can purchase the car or return it to the dealership.
With leasing, monthly payments are usually lower because you are only paying for the depreciation during the lease term. Moreover, maintenance and repairs might be covered under the lease. Another benefit of leasing is that you can get a new vehicle every few years.
To learn more about buying and leasing a car, see the accompanying resource.
Infographic created by O’brien Toyota